What industries can benefit from Lean and Six Sigma?
Updated: Apr 17
Lean and Six Sigma may stem from manufacturing, but the principles apply equally to other industries too.
All organisations have problems to solve. All organisations have waste. In fact, the service industry tends to have more waste than in manufacturing, primarily because much of the work and deliverables are less tangible than in a production environment.
And all businesses want to be able to do more while using less resource. To grow profits, reduce costs, and build effective teams.
Here are some of the key industries who can benefit from Lean and Six Sigma.
Lean and Six Sigma have both grown out of a long tradition of quality and process improvement efforts in manufacturing. For example, Frederick Winslow Taylor’s scientific management and Frank Gilbreth’s “time and motion” studies were among the earliest prescriptions for improving the quality and efficiency of production processes.
Lean and Six Sigma is particularly synonymous with the automotive industry. Lean was first pioneered by Ford in the early 1900’s, and can famously be attributed to Taiichi Ohno’s articulation of the Toyota Production System (TPS), where he first identified the seven types of waste. Automotive companies have benefited from being able to produce more vehicles, at a higher quality and with fewer recalls. And dealerships have benefited from increased sales and faster servicing by removing waste such as motion and inventory.
Lean and Six Sigma have been applied time and time again to manufacturers with dramatic results. From food/beverage products, to appliances, furniture, and pharmaceuticals; manufacturers have seen defects significantly reduced and in some cases, almost eradicated completely. This has directly impacted on profit margins and greatly improved customer satisfaction, resulting in customer loyalty, reputation for quality and more sales.
Instilling a Lean culture and implementing Lean processes vastly improves service delivery. In the healthcare industry specifically, the application of Lean can reduce the amount of time nurses spend looking for wheelchairs, patient records or medicines, and increase the amount of time they spend taking of patients. Preventative maintenance of equipment and a Lean 5s workplace organisation helps ensure the right tools are available when needed.
Lean and Six Sigma can also be applied to the laboratory. Lean can be used to streamline testing processes, and Six Sigma can be applied to reduce errors, therefore saving time and money.
Financial and Legal Services
As another process-driven service industry, companies in financial and legal services are ideally positioned to leverage the benefits of Lean and Six Sigma. An application for a bank loan, a request for an insurance quote, or conveyancing for example, may go through many systems and hands before the process is completed. Removing non-value adding tasks and eliminating errors can greatly increase the ability to meet customer requirements faster and more accurately.
On the surface, Education and Lean and Six Sigma may seem incompatible. However, many of the activities that go into providing an education are repeatable processes.
The demand for schools to operate more efficiently and direct more resource to the classroom means Lean and Six Sigma methodologies are becoming more and more recognised in education. They can be used to reduce variance and streamline administrative processes, such as admissions and enrollment, certification, grant administration and repair and maintenance practices. And Lean and Six Sigma can even be utilised to get the most out of teachers and students.
Retail and Hospitality
The retail and hospitality industry is reliant on excellent customer service, timely delivery of products, and accurate inventory counts. Lean and Six Sigma provides a useful strategy for improving these important elements.
Global retailers such as Amazon, Nike and Staples have all applied the principles of Lean and Six Sigma to their business models with great success. Leveraging Lean and Six Sigma means better outcomes for customers, and more sales as a result.
Lean and Six Sigma can easily be applied to office environments where lots of non-value adding tasks are being carried out. Insufficient equipment, over-ordering of stationery, duplicating processes, having to wait for multiple signatures and underutilised personnel are all examples of waste. The result of removing this waste and streamlining processes is greater productivity, a happier workforce, and a better service for customers.
In fact any administrative function of a business can benefit from Lean and Six Sigma, such as Accounting, Operations, Sales, Marketing, HR and IT. Delivery in all these areas involves processes which can be improved with Lean and Six Sigma principles.
Lean and Six Sigma isn’t just for manufacturers. As we’ve demonstrated in this blog, the positive impact of Lean and Six Sigma can be seen across the services sector, in education, and even in any office environment.
To find out how Lean and Six Sigma could benefit your business, get in touch here.